I've Won Big in Sweepstakes, and You Can, Too

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About

I have been investing since I had my first real job. I am an omnivorous reader, foodie, cinephile, and Buffett admirer (both Jimmy and Warren). Working at newspapers was my passion but my new path is informing and entertaining my readers on the web.

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So here's my dirty little secret. I am a "sweeper," as aficionados call it. Entering sweepstakes is a hobby for me and 55 million other Americans. But it's a hobby that frequently pays off. I've won a Toyota Prius (affectionately called MA, short for "major award"), three trips to the Caribbean and one to space camp, jewelry, spa treatments, gift cards and cash. In fact, I just received an $100 gift card.

For hobbyists it is an undeniable thrill to win but what are the odds? Warren Buffett made news when Berkshire Hathaway (BRK-B) insured the Quicken basketball bracket challenge with nine quintillion ways to fill a bracket and a $1 billion prize. No one won it. Odds of winning the famous Publishers Clearing House sweeps are only slightly better, the latest one with odds of 1.3 billion to one. These mega sweeps have worse odds than the Powerball lottery game.

First, Understand the Following

Thousands of companies offer legitimate sweeps -- including major corporations like Procter & Gamble (PG), PepsiCo (PEP) and McDonald's (MCD) -- to generate buzz and brand familiarity and loyalty. These are usually judged by D.L. Blair, ePrize and other organizations known for their integrity. When I get a letter from D.L. Blair, my heart begins to race.

Years ago, "sweeping" required tedious envelope stuffing and a generous outlay on postage. Now it's as simple as a few keystrokes, without costing you a penny. Most days I can enter a hundred or more just by running through my bookmarks and using Roboform.

Let's clarify. A contest is judged (photo, essay, recipe or video required) and may require a fee to enter. A legitimate sweepstakes will never require a purchase to enter and an alternative means of entry will be listed in the official rules if the sweeps asks for a proof of purchase or universal product code. This is required under federal law, to eliminate what is called a "consideration" and why sweepstakes aren't considered gambling.

The biggest hurdle is increasing your odds. Many sweeps offer the opportunity to enter daily, and some offer unlimited entries. You can bookmark these easily and either use your browser's autofill options or a free application like Roboform to fill out entries to save hours of tedious typing. I like to get in at the beginning of an entry period and enter daily until the end.

A recent trend, according to sweepstakestoday.com founder Craig McDaniel, has been Fortune 1,000 companies using sweeps to boost their Facebook likes and fans. Although he notes this is winding down somewhat, it has led to the emergence of giveaways on other social media venues, like Pinterest, Twitter (TWTR), blogs and Instagram.

Many sweeps will offer extra entries if you share on social media. Why not? You can double the number of your entries by sharing. After sharing on one Facebook sweep my entries were quintupled the next time I signed in.

Helpful hints:

Have an antivirus software installed on your computer and pay attention to its warnings.

Dedicate an email address just for sweepstakes. You will get more spam than you are used to, but this annoyance is easily offset by the thrill of a win.

Check this email account often. Companies often use email to notify winners. If I hadn't checked my email, I wouldn't have known of the trip I won to Turks and Caicos to be a judge at the annual Conch Fest. Fun!

Delete without opening emails announcing wins from Nigeria or international lotteries. They are invariably a scam. With a good antivirus program and some common sense I haven't had any problems.

Never, ever, give out your credit card or bank info. You may, however, need to give your Social Security number on an affidavit of a win so the tax man knows of your good luck.

Read the rules at least once -- and follow them.

Only enter sweeps where you want the prizes. A car, cash, trips and electronics are the most popular prizes, according to McDaniel. Unusual prizes have included a trip to New York City for a colonoscopy ("CBS Cares") and a chance to be a CEO (chief egg officer).

Keep a positive attitude. This is supposed to be fun, an easy way to while away the time. It's pleasant to dream of what you'll do with a win.

When you win, be sure to respond to the announcement promptly. If you receive an affidavit to notarize, most FedEx, UPS stores and banks can handle that for you. My bank calls me "Lucky Lady" when I come in because that's where I go to notarize.

Remember the tax man. Although prizes are untaxed in Canada, they are in the U.S., and any win with a value of $600 or more will generate a 1099-Misc.

Write the sponsor a thank you note. It's the least you can do with a big -- or little -- win.

"The keys to winning are still the same," McDaniel noted. "It takes consistency and persistence."

Interest rates are low, but that's no excuse to accept 0.01 percent interest rates on your savings. Just a little shopping can find you many FDIC-insured savings accounts paying as much as 1 percent in interest, usually with no fees and easy availability to your money through electronic funds transfers. Compared to the near-zero rates that uninsured money-market mutual funds and other alternatives pay, high-interest savings accounts are a much safer way to save.

Banks still try to get customers to pay more for less, with one recent threat to charge fees for basic deposit accounts if the Federal Reserve cuts interest rates further. But many online banks not only offer fee-free options on their checking and savings accounts but also pay interest, and many have extensive fee-free ATM networks or reimbursement arrangements. If your bank follows through on threats to raise fees, taking your business elsewhere is your best move.

Bankrate reports that the average credit card charges around 16 percent in interest. That's a guaranteed money-maker for the banks that issue cards, but a big loser for those who carry balances on their cards. With many cards offering promotional interest rates as low as 0 percent, using them to get rid of high-interest cards is a no-brainer move and can help you pay your debt down faster.

Mistakes on your credit history can keep you from getting a loan that you want to buy your next home or car, but they can also have consequences you'd never imagine. Increasingly, insurance companies, apartment rental agents, and even prospective employers order copies of your credit report to see if you're financially responsible. Be sure to take advantage of your free credit check at the government's annualcreditreport.com website to make sure the three big credit-rating agencies have everything right before mistakes come back to bite you.

Payday loans have gotten more tightly regulated recently, but banks and other financial institutions still offer ways to let you get quicker access at your cash -- for a hefty fee. Resorting to short-term money fixes can land you in even more problematic situations down the road, because those solutions often create debt spirals from which it's hard to emerge unscathed. Set up an emergency fund instead and be prepared in advance for the money woes that life throws your way.

Interest rates have risen during the last half of 2013, with a typical 30-year mortgage carrying a 4.5 percent interest rate. But many homeowners still carry higher-interest mortgages from before the financial crisis. Now that home prices have risen, you might be able to refinance for the first time, and many homeowners have used lower rates to cut hundreds from their mortgage payment or shift to a shorter-term 15-year mortgage to pay off their debt faster.

Too many people never update their insurance coverage to deal with changes in their coverage needs, whether it comes from changes in family status for life insurance, health conditions for health-care or long-term care insurance, or even what types of property you own for homeowners' insurance. Don't wait for disaster to strike; check with your insurer or agent to see if your current coverage meets your needs.

In the past, investors had to pay hundreds or even thousands of dollars just to make a simple stock purchase. Now, though, the rise of discount brokers, low-fee index funds and exchange-traded funds, and freely available investment news and advice have made it silly to spend large amounts to get access to the financial markets. If you're still paying your broker too much to invest, look into alternatives that can help you avoid cutting serious money out of your retirement nest egg.

Everyone likes a tax break, and one of the best ones for you to use involves making contributions to a tax-favored retirement account. By putting money in an IRA or 401(k), you can reduce your current taxable income and save on your taxes while also preparing for the future. With 401(k)s, your employer might even chip in a bit on your behalf. Even when times are tough, finding even small amounts to save can put time on your side and make a big difference down the road.

Many investors found out the hard way this year that bonds aren't as safe as they thought, with some major bond funds posting double-digit percentage losses in 2013. Despite those losses, bonds still carry substantial risk in 2014, with many calling for imminent interest-rate hikes that would erode their value further. Even now, bond rates are so low that they don't compensate you much for their risk.

In contrast to bonds, stocks have soared in 2013. That has some investors finally piling into the market for the first time since 2008 and 2009, while others remain shell-shocked from the massive losses they incurred back then during the financial crisis. Even with the Dow Jones Industrials (^DJI) and other major market benchmarks near all-time record highs, it makes sense to have some stock exposure in your portfolio. Just don't go overboard in the false belief that gains of 20 percent and 30 percent will happen every year.

If you pay full price for just about anything these days, you're paying too much. The rise of deep-discount stores has led to falling prices at stores and shopping malls. Moreover, online tools like coupon sites, daily-deal offers, discounted gift cards, and cash-back credit-card deals can cut your costs as well. With all these tools, you won't find many situations in which you have no chance of getting a bargain on the items you want.

In the past, many young adults focused on getting into as strong a college as they could, figuring that their degree would pay them enough to make up for the costs they incurred. With college graduates facing a more challenging job environment than ever, smart students are thinking about college costs before they make a decision on a school. By maximizing financial aid and looking at lower-tuition schools with nearly as strong educational quality, you can avoid creating a big debt hole that you'll struggle with for years into the future.

If you don't have a will, a power of attorney for financial and health-care matters, and an advance directive to tell medical professionals whether you want certain life-preserving measures taken if something happens to you, then you're putting your family at risk. Many people don't have even these basic estate-planning documents, but getting them in place is easier and less expensive than most believe. Get your affairs taken care of in 2014 and save your loved ones some big future hassles.

Resolving to be more financially astute and to avoid common mistakes will help you get your finances in order more quickly. These tips should give you more money to help you meet all your financial goals.

Sweepstaking is fun and it helps pay the bills. No, I haven't won a car. Though I did win a trip once. Otherwise, I see a lot of small wins like a phone charger, almond butter, or shampoo. You can win more if you invest more time in it.